(July 28, 1966)

This telegram summarizes a discussion between the
State Department and the Government of Israel about the refugee problem.
In it, the Government of Israel provided several proposals to solve
the problem, with the assistance of the Americans in approaching the
Jordanians and reforming the UN Agencies responsible for the refugees.

Telegram From the Department of State to the Embassy
in Israel/1/

Washington, July 28, 1966, 3:49 p.m.

16922.

1. Israeli Envoy Gideon Rafael, accompanied by Amb.
Harman, today presented to Secretary results of GOI task force deliberations
on possible initiatives on refugee problem. He began by saying GOI has
not made any decision, but would like to put forth some tentative proposals
for our consideration.

2. Rafael said GOI eliminated possibility of any overall peace proposal
because Arabs would not accept that. Repatriation means for Arabs driving
Israel out of Mideast. This left rehabilitation-resettlement as only
possible basis for progress.

3. He recalled US and UN had negotiated resettlement projects with
Syria, Egypt and Jordan under UNRWA rehabilitation fund in early fifties,
and then proposed we prepare ground at GA for creation of similar rehabilitation
instrument financed by international subscription to which Israel could
contribute with help of loans.

4. When Secretary asked if GOI excludes repatriation, Rafael said yes,
at this stage, because repatriation is symbol of Arab hostility to existence
of Israel. Time is ripe, he said, for rehabilitation and against repatriation
which is not realistic basis for settlement. GOI is inspired by Hussein's
speech,/2/ he said, and believes his ideas about "breaking down
walls of UNRWA and getting refugees out of camps" should be encouraged.

5. In reply to question, Rafael said Jordan should
be approached separately, because divisions in Arab world would prevent
Arabs from acting as group. Lebanon would go along when feasible, Harman
added.

6. When Secretary asked if GOI already in touch with any Jordanians
on this, Rafael said no, GOI wanted first to discuss with USG. GOI does
not want to make approach, he said.

7. He then added GOI for time being only wants to prepare groundwork
at UNGA for this project, i.e. to conduct debate in such way as to show
Arabs UNRWA is not permanent fixture, that UN will not respond to further
Arab attempts to politicize this question. When Secretary asked if GA
then would be final rather than first step, Rafael said first steps
would be reform of UNRWA, reduction of relief rolls, elimination of
PLA, then assuring that host states prepared to take over responsibility--these
would prepare ground for this proposal.

8. Rafael asked if US would take up proposal with Jordanians. Secretary
said USG could not take lead. If we broached idea, question of repatriation
would immediately arise. He suggested Israelis might wish approach SYG
Thant and ask him if he would take this up. Jordanians should be asked
if King Hussein's speech indicated any Arab interest in rehabilitation,
he added.

9. Rafael said this idea was GOI constructive approach to problem.
If this not acceptable, he indicated, many felt GOI should simply take
no action but remain strong and wait for more favorable time for dealing
with refugee problem.

10. Secretary noted that Arabs know rehabilitation has been available
to them from outset. He said he had no indication they had changed in
their negative attitude toward it. He also cautioned that UN unlikely
to forget repatriation aspect of resolutions.

11. Secretary concluded by stating he not rejecting suggestion "if
you and Arabs agree on it," but indicated again Israelis should
sound out Arabs through their own means.

12. Above is full record of conversation and no additional memcon being
prepared.

13. Rafael's earlier separate conversations with Assistant Secretaries
Hare and Sisco followed same line as above. Memcons by pouch./3/

Rusk

/1/Source: National Archives and Records
Administration, RG 59, Central Files 1964-66, REF PAL. Confidential;
Noforn Except Israeli officials. Drafted by Campbell, cleared by Symmes
and Sisco, and approved by Buffum. Also sent to USUN and repeated to
Amman, Beirut, Cairo, Damascus, Jerusalem, and to Geneva for Goldberg.

/2/Reference is to a June 14 speech
by King Hussein in which, inter alia, he declared his rejection of "the
absurd logic and the weak policy which advocates keeping Palestinians
in tents and camps surrounded by barbed wire." Telegram 787 from
Amman, June 20, transmitted that portion of his speech. (Ibid., POL
15-1 JORDAN) The Embassy in Amman commented on the speech in telegrams
776, June 15, and 778, June 16, highlighting what telegram 778 called
the King's "blistering attack" on the PLO, and his charge
that the peril of Communism was greater and more dangerous than that
of Zionism. (Both ibid.)

/3/A memorandum of Rafael's July 26
conversation with Hare is ibid., REF ARAB. A memorandum of his July
27 conversation with Hare and Sisco is ibid., REF 3 UNRWA.